Two years ago, telematics was thought to be a rich new source of revenue for carmakers, and as easy as fishing with grenades. Now that sophisticated in-car communications are off the hype curve what's the real story? Will telematics forever be a codeword for irrational automotive exuberance?

Several speakers at the Microsoft European Automotive and Telematics Conference in association with Automotive News Europe in Munich seemed to say: "Yes, telematics is still dead, get on with your lives." Others suggested that a new post post-hype period has begun.

The search for an obvious telematics business plan goes on. Consumers say that only a few services interest them and they aren't willing to pay much for those.

That's what they say. In fact, customers will get used to cars that communicate whether they want to pay for them or not. Automakers will have to offer services.

The need for a business case seems almost irrelevant. Can you imagine selling a premium-class car a couple of years from now without hands-free telephone, navigation and emergency response? Do you have to make a business case for airbags?

Carmakers have learned some things. For one, in-car infotainment is not an attractive proposition. Far from it. It turns out that people don't want to buy stock while driving their cars. Neither do they want to surf the net or download MP3s. Forget mobile multimedia. It's not happening.

"It's not interesting for customers to have Internet in their car," said Jan-Christiaan Koenders, director of advanced marketing concepts at BMW.

Drivers are interested, a little, in finding a parkhaus in Munich with empty spaces if it's late and they've just driven in from Dordrecht. But not if they have to pay a monthly subscription fee for the privilege. The concept of subscription fees - where all that projected revenue was to come from - is absolutely dead. Consumers will pay once, up front, or maybe on a per-use basis. But either way they won't pay much.

On the other hand, use of telematics for customer relationship management (CRM) and vehicle relationship management (VRM), such as remote diagnostics and predictive maintenance, are useful tools and almost sure things.

But they won't be giant revenue generators and they aren't all that exciting because all carmakers will have to do it to stay competitive. They'll use on-board information beamed back to the factory or to the sales and marketing department to retain customers, learn about the behavior of cars and drivers and new technology and to better plan and operate their core businesses.

The company that first exploits CRM and VRM telematically will have a brief advantage. But eventually it will be like everything else. Toyota will do it just a little better than the rest.

There were some other interesting observations at the conference. Kai Rose, project manager, telematics and electronic product innovations at Volkswagen, says the future belongs to voice recognition. Sophisticated touch screens will never catch on, he says, because voice is cheaper and safer.

His doubters cited the polyglot of eastern European languages. And I wonder about those stressful moments behind the wheel when you're nervous and - though it's on the tip of your tongue - you can't quite come up with the right word?

One recurring theme in Munich: standardization can't happen soon enough. Until everyone uses the same plugs costs won't come down and telematics won't take off. There needs to be one common architecture (or maybe two) that goes from car-to-car, company-to-company, continent-to-continent.

And there has to be cooperation and collaboration among carmakers. Indeed, what a great opportunity for industry work-togethers. Nobody thinks they can make money with telematics, yet everyone has to offer telematics. If that isn't a formula for cooperation I don't know what is.

Wahlberg says the industry is not sitting and waiting for killer apps. It's looking for killer cross-company and cross-industry collaborations.

Meanwhile, consumer electronics companies that want to use telematics to get into the auto industry don't live on the same planet as car companies. They have wildly different product life cycles and alarmingly different concepts of reliability.

The independent software providers want to use a platform such as Microsoft's Windows' Automotive to dazzle carmakers. But auto companies worry about software glitches that get them into trouble on J.D. Power quality surveys.

Peter Hausserman, vice president for telematics at DaimlerChrysler, says so far telematics software has been "differentiated by quality, not functionality, which is not what we expected."

He called telematics software development "the weakest link in the chain."

Tony Scott, chief technology officer at General Motors, said that GM spends more for software in each car than it does for steel. But though automakers know how to specify steel and measure its quality and reliability, Scott says they don't know how to do that with software.

For car owners, a minor software bug can be as traumatic as a major engine breakdown and they aren't afraid to describe it in those terms to customer satisfaction surveyors.

So naturally carmakers are nervous about the small, creative but suspect software creators - the same vibrant little companies that make so much happen in the consumer electronics business.

The thing is, if there is a killer app out there that will help carmakers make money from telematics, it will come from one of these companies.